The plan was announced by visiting Armenian Prime Minister Karen Karapetyan in a meeting with Iranian Parliament Speaker Ali Larijani in the capital Tehran on Monday.

"Yerevan has invited Eurasian and European parties to get involved in the free trade zone trade and economic activities," Karapetyan was quoted as saying.

"The free trade zone would be of significance for foreign businesses given its proximity to Iran," he said, adding that Iranian merchants could lead to an economic boom in the zone by taking an active role.

He expressed Armenia's willingness to form a new type of relations with Iran with a new outlook.

For his part, Larijani pointed to the reciprocal investment between the two neighbors, saying they should develop a clear understanding of each other's trade needs.

He also hailed the decision by Yerevan to remove visa requirements for travels between Iran and Armenia, saying it has greatly helped the tourism industry in both countries.

Iranian and Armenian officials signed three memoranda of understanding in veterinary, technology and cultural sectors on Monday at the sidelines of a meeting between Karapetyan and Iranian first Vice President Eshaq Jahangiri.

During the meeting, Jahangiri said Iran is keen on deepening relations with neighboring countries, and sees no obstacle to boosting cooperation with its neighbors, especially Armenia.

Lauding Tehran-Yerevan ties as "age-old," the vice president said the relationship between the people of the two countries is based on numerous commonalities.

Jahangiri also said various fields of gas, electricity, agriculture, converting industries, technical and engineering services, as well as transport, can be among the areas of cooperation between the two countries.

Meanwhile, Karapetyan pointed to some joint projects between the two countries and stressed the need to eliminate the problems hampering the implementation of these projects.

The Armenian prime minister also emphasized his country's readiness to boost bilateral trade with Iran remarkably.

Heading a high-ranking delegation, Karapetyan arrived in Tehran on Monday at the invitation of Jahangiri.